Chapter 04 · Section 4.1
Usage on Exchanges
The term "trading volume" is used both on stock exchanges and on option or futures exchanges. Why is the term "open interest" not used for stock exchanges?
a) Because there is another term replacing it in the context of stock exchanges.
b) Because, in principle, there is no such a thing as open interest on a stock exchange.
The basic difference between a stock exchange and an option exchange is that (as long as all transactions are spot) no security is "created"
on the stock exchange. People just trade in the securities available.
On an option exchange, however, the option "is born" on the exchange. Before the option was first traded, it simply did not exist.